Brokerage Relationship Disclosure vs Exclusive Buyer Brokerage Agency
UNDERSTAND FORMS CHANGE FROM TIME TO TIME, CORRECTIONS, UPDATES, STATUTORY REVISIONS. LINKS ARE AS OF 26AUGUST2024 IN THIS PAGE.
In Florida, at this time, Agents/Brokers are Transaction Broker, by default, by law, unless otherwise advised.
My opinion, and our means of practice, is to disclose at the earliest must opportune time the brokerage relationships that we can have and allow the client, consumer, customer, to choose the level of duties owed to them based on law and our relationship. This is a seldom used document, unfortunately, and you need to be your best advocate, be Pro-Active!
The three docs link to the Brokerage Relationship Disclosure, and the varying statutory duties owed.
BROKERAGE RELATIONSHIP DISCLOSURE – SINGLE AGENT (BUYER OR SELLER) BRD-6SA
BROKERAGE RELATIONSHIP DISCLOSURE – SINGLE AGENT WITH TRANSITION TO TRANSACTION BRD-7TNX
BROKERAGE RELATIONSHIP DISCLOSURE – NO BROKERAGE RELATIONSHIP BRD-3NBR
An Agent/Broker cannot represent a Buyer and Seller both as a Single Agent/Broker, in same transaction. Florida does not practice Dual Agency. Meaning two Agent/Brokers in the same office cannot represent as a Buyer Agent/Broker and a Seller Agent/Broker to a Buyer and a Seller in the same transaction, they should have transitioned to a Transaction Broker. If not transitioned to Transaction Broker, one would be a customer, likely the buyer, the other a client represented as a Sellers Agent/Broker. Also, Sub-Agency was commonly practiced through the 90s, and a bit beyond, which meant that all Agent/Brokers worked for the Seller. Nor does Florida practice under terms of Intermediary, but does Appointed or Designated Agency. (Both I believe impossible to fully protect both Buyers and Sellers from unfair disadvantage.) Practices and law has evolved for increased disclosure and protections, as well as defining statutory duties led in each case.
If you are a Buyer with another Agency/Brokerage, and this form is not put in front of you, early in your conversation, and before you disclose anything, it very well may put you at an unfair disadvantage in negotiations. This includes the price you are willing to pay versus the price it is being offered at, your qualification amount, proceeds from a sale you will be applying to this property, cash in the bank, why you are buying, your requirement to sell another property, your income, marital status as it relates to your ability to purchase.
This all sounds like information YOUR Buyers Agent/Broker will need, and you are absolutely right it is! However, if they are not a buyers Agent/Broker YET, they do not owe you certain duties, including loyalty, obedience, material disclosures, skill, care, and diligence, and CONFIDENTIALITY. They also do not owe you a duty to present offers timely. Yes, think about that one.
You must be Pro-Active, be your own best advocate. Establish your Brokerage Relationship and enter into an Agency Agreement so that you understand what that Agent/Broker is or is not going to do for you!
Transaction Broker, is a good midline broker relationship, that maintains certain statutory confidences, IF they do not directly apply to your ability to complete the transaction. This includes, what you are willing to pay versus what you offered, your reasoning for buying, or selling. These confidences do not include any material facts in your personal or financial history which will preclude you from being able to purchase this property. Such as, having to sell another house, bankruptcy, financing restrictions, unverified funds to close, if you spent your down money, if you gave it away, if you have an undocumented influx of cash into your account for closing, if you quit your job, if you cut your hours back, credit delinquency, you failed to disclose to the lender, judgments and liens not disclosed, back child support, alimony. All inhibit your ability to purchase, that is disclosure, and a statutory requirement.
A few words on Exclusive Buyer Brokerage Agreement. This document is entered into AFTER your interview with the Agent/Broker, your relationship is established, confidences are advised, and you are going to work with this Agent/Broker exclusively, as your Buyers Agent/Broker. This document should represent the same representation as the brokerage relationship disclosure you signed, Buyer Agent/Broker, a.k.a. Single Agent/Broker, Transaction Broker, or as a Customer, No-Representation. Duties owed to you are different.
The Exclusive Buyer Brokerage Agreement (bottom left corner identified as EBBA-) is not the document that should be forwarded to the Sellers Agent/Broker. It discloses information that will put you at an unfair disadvantage in negotiations. Make sure your Agent/Broker understands the difference between these forms, and the detriment it places on your ability to negotiate. The Brokerage Relationship Disclosure (bottom left corner identified as BRD-), is the document forwarded to Sellers Agent/Broker to aid in defining any compensation offered by the Sellers Agent/Broker.
The four docs link to the Exclusive Buyer Brokerage Agreements.
EXCLUSIVE BUYER BROKERAGE AGREEMENT – SINGLE AGENT EBBA-7SA
EXCLUSIVE BUYER BROKERAGE AGREEMENT – SINGLE AGENT WITH TRANSITION TO TRANSACTION EBBA-7TN
EXCLUSIVE BUYER BROKERAGE AGREEMENT – TRANSACTION BROKER EBBA-7TB
EXCLUSIVE BUYER BROKERAGE AGREEMENT – NO BROKERAGE RELATIONSHIP EBBA-7NR
Compensation to a Buyers Agent/Broker is no longer required to participate in the multi list services advertising, nor is their a data field to express such. Commissions and compensations must be negotiated outside of the MLS. Your Buyers Agent/Broker should advise you that you may be responsible for all or a portion of their compensation, and they should inquire prior to showing the property as to the requirements to show the property as well as compensation offered. It is not uncommon for the Buyers Agent/Broker to seek compensation from the Seller. But be advised, you may owe them part or all of that commission that you agreed to pay in your Exclusive Buyer Brokerage Agreements.
In summary the Brokerage Relationship Disclosure, defines the type of relationships you could have and will have, and clearly defines the statutory duties owed to you by that Agent/Broker.
The Exclusive Buyer Brokerage Agreement, also known as the Buyer Agency Agreement, defines the parameters of your criteria for your purchase, such as location, term, type of property, retainers, specialized terms and conditions of property attributes, your ability and restrictions, confidential information that may put you at an unfair disadvantage in negotiations- as well as compensation owed a Buyers Agent/Broker.
Be Pro-Active, be your own best advocate.
QUESTIONS??? CALL TEXT OR EMAIL CRAZY WOMAN MISSY 307-360-7771 CWRWYO@GMAIL.COM